Mike Fedewa, Chair

JoAnne Woodard

Kathryn Meyers

Alfred Bryant

Ben Currin

Kate Alice Dunaway

Sandy Carmany

Arlene Ferren

Randy Dow

Otho B. Tucker , Director , Office of Charter Schools

O’Linda Williams, Administrative Assistant, Office of Charter Schools

Jackie W. Jenkins, Consultant, Office of Charter Schools

Carl F. Pridgen, Consultant, Office of Charter Schools

Laura Crumpler, Attorney, State Attorney General’s Office

Linda Ivy, Charter School Accountant, Auditing and Charter Schools

Gene Bruton, Accountant I, Charter Schools and Auditing

Linda Ivy, Charter School Accountant presented the following report regarding the current status of the charter school audits received for fiscal year ended June 30, 2002, as of December 11, 2002, from the LGC:

Total Audits due to DPI: 91

Audit Received at the LGC 85

Audits received to date from the LGC: 66

Audits reviewed to date: 65

Audits due to DPI from the LGC: 19

Ms. Ivy also reported that the nine schools that have financial deficits for the fiscal year in question have been sent a letter requesting detailed information regarding the status of that deficit. The schools have 20 days to respond to DPI’s request.

Ms. Ivy reported that two charter schools have been placed on financial warning status. One school, Imani Charter School in Guilford County was placed on Financial Probationary Status on August 12, 2002 for failure of the audit. This school will remain on Probationary Status until the audits have cleared the LGC and DPI review.

Rowan Academy was placed on Probationary Status on September 5, 2002. Since being placed on Probationary Status, the school has received a gift of $165,286.70 to cover back teacher pay and the current year budget deficit. To this end, DPI will continue to monitor the school over the next several months and remove it from Probationary Status if no problems arise.

Ms. Ivy reported that the LGC has accepted Wayne Technical Academy’s audit that was received on November 4, 2002 as being substantially in compliance with GAAP after additional information was presented. She further reported that the school continues to have problems submitting SIMS and SAR reports in a timely manner.

Dr. Otho Tucker extended remarks on behalf of Dr. Zoe Locklear in her absence. She apologizes for her absences and acknowledges these meetings as a very important part of her responsibilities as Associate Superintendent of Leadership Development and Special Services. She keeps abreast of what is happening with charter schools through correspondence from the Office of Charter School.

In response to the inquiry regarding the SBE representative to the CSAC, Dr. Tucker responded that it is his assumption that Ms. Kathy Taft is still the representative. However, since Charter Schools is still under the Efficient and Effective Operations area in which Mr. Wayne McDevitt now heads, he is not sure if Mr. McDevitt will attend the meetings or Ms. Taft who heads the Higher School Performance area will attend.

Dr. Jackie W. Jenkins, Consultant, Office of Charter Schools provided a PowerPoint presentation of the Charter School Application Review Process. The presentation included a review of the need for the application review process, key selection issues, the application interview guide, the planning year time line as well as other issues critical to the recommendation and selection process.

Dr. Jenkins presented some of the key issues that are scrutinized in the application review process that are consistent with the North Carolina Charter Schools Act which included an education plan that reflects the school’s commitment to the six purposes of the charter legislation among others. She noted that the changes in the information required in the Education Plan from the previous charter application that can now be found in the current application. It was also noted that the revised application contains a more in-depth checklist regarding the educational process.

Regarding the interview process and questions that may potential be asked of applicants, Dr. Jenkins recommended that the Committee address the following area: NCLB, school governance, marketing, the educational plan including specific plans for education of exceptional children, the preliminary planning year and small business management. These questions should be posed in a manner that would lead to the selection of the best candidates or those that demonstrate the ability to implement the charter based on the strength of the planners.

Dr. Jenkins presented questions to consider regarding the ballot process. The Committee was asked to consider whether the "yes/no" ballot provided the structure for determining continuation in the interview stage. To this the Committee responded that the yes/no ballot would be helpful in determining if the application should be considered in the ranking process rather than the interview stage. The Committee further amended the recommendation by adding that the consensus of two-thirds (2/3) of the members present is needed in order for the application to be considered for the ranking process.

It was recommended that the ranking simply consist of ranking the numbers on a scale that does not include a numerical statistical value but perhaps simply a 1-10 ranking based on the selection criteria.

The Committee further agreed that the ranking sheet that was used in the previous process would not be useful during this cycle. The sheet in question provided a format for members of the Committee to rank the application on how well the six legislated proposes for charter schools were addressed.

Dr. Jenkins will present the revised packet to the Committee at its February meeting. The revisions are based on recommendations from the Committee.

Dr. Otho Tucker presented data that reflected the statistical profile of charter schools from 1997 to the current year. The report included a profile of the application history which included the number of applications submitted each year, the number currently operating that were approved for that year, the number of revocations and relinquishments. Other data included pupils in membership by race and sex, pupils in membership being served in EC programs, and ABCs data.

The information presented was intended to provide a framework for the Committee as it considers making recommendations in response to the charter school items on the legislative agenda that will be forwarded to the General Assembly.

The CSAC discussed items related to charter schools that were included in the draft legislative agenda that was presented to the SBE at its 12/04/02 meeting. During the SBE Meeting, the Board decided to hold a special issues session in February to discuss the charter school items. The Committee was asked to provide feedback and recommendations regarding the items to be presented.

The Committee discussed the following items:
G.S.115C-238.29D(d) Final approval of applications for charter schools.

SBE Recommended Changes: Extend the length of the initial charter granted to 10 years with a five-year review cycle.

The Committee agreed with the recommended changes.

SBE Recommended Changes: Amend the renewal length of a charter to a ten-year renewal with a review during the fifth year of the cycle.

The Committee agreed with the recommended changes.

SBE Recommended Changes: Clarify terminology "shall hold teacher certificates." In addition to holding a teacher certificate, any employee teaching in a core subject area in a charter school must be a college graduate.

The Committee recommended that the change reads as follows: "shall hold NC teacher certificate or be actively working towards obtaining a teacher certificate."

Reasoning: The CSAC feels it will make reporting each school’s licensure status to DPI accurate and dependable. Reporting will be necessary for the state report card and for NCLB that will require the ability to verify reports. This action would assist in the reporting of the licensure status for schools entering the renewal process. Furthermore, it would fit the NCLB language that speaks to meeting the state licensure requirements with regard to high quality teachers.

The motion to accept this recommendation and reasoning passed unanimously.

SBE Recommended Changes: Add a "hold LEA harmless" clause for the loss of state revenue due to a charter school opening within the LEA by providing 60% of the lost revenue in the first year and 40% of the lost revenue in the second year.

The CSAC does not recommend any hold harmless clause for the LEAs.

Reasoning: The CSAC feels that the addition of the planning year for charter schools should also be seen as a planning year for LEAs. Therefore, they will have sufficient time to deal with the changes that are involved with opening a charter school in the LEA.

The motion to accept this recommendation and reasoning passed unanimously.

In response to G.S. 115C-238.29I, the SBE recommends that current charter school statutes concerning charter school renewal and process review, teacher licensure and retirement, and clarification of what constitutes local funds and loss of revenue by counties with charter schools be modified to improve the overall quality of the charter school program and to ensure successful implementation of new and existing charter schools as well as to support the continued efficient and effective operation of traditional public schools. Following implementation of these modifications, the charter school cap should be raised to 110 in the school year 2003-2004.

The CSAC recommended that following reading of the recommendation: "Due to the fact that charter schools have made consistent improvement and that they are held accountable, the cap on the number of charter schools should be expanded by 10% of the previous year’s number of operating charter schools."

Reasoning: This would allow for systematic but controlled growth of charter schools. It would also allow for demand, if it existed, to be a part of the expansion or reduction of the number of charter schools. Such a policy would keep this agenda item from being a continuing legislative issue while still controlling expansion. The Committee also makes note that just because there are charter slots available that would not mandate that the slots were filled. The scrutiny used to find schools with a high potential for success would not be compromised. Only those meeting the expectations set forth by the statute and the application process would be forwarded to the SBE for consideration.

The Committee was reminded of the January 8-9, 2003 meeting of the SBE and the February 17-19; 2003 Accountability Conference. Committee members were also reminded to plan to attend the Sixth Annual NC Charter Schools Conference scheduled for July 22-25, 2003 in New Bern, NC.